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50th Anniversary Stories
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To celebrate EDAM's 50th Anniversary, here are some stories about past projects, successes and lessons learned during the first 50 years of EDAM.

We'll add more stories over the rest of the year, so check back regularly.

 

North Washington Jobs Park


In 1993, the Minneapolis Community Development Agency (MCDA) and City of Minneapolis adopted a plan to redevelop an underused, highly contaminated site near its downtown core and to create new employment opportunities for residents who lived on the city's north side — which had the city's highest unemployment rate.

The North Washington Jobs Park plan set in motion a more than $18 million rehabilitation of the city's North Washington Industrial Park into a job rich area of manufacturing, distribution and transportation companies by 2001.

The MCDA actively purchased underdeveloped parcels and, through partnerships with the State of Minnesota, remediated the contamination at a total cost of over $7 million.

A steering committee comprised of community stakeholders (businesses, residents, educators, social service agencies and public officials) created a strong public-private partnership focused on results. The steering committee oversaw the work in the Jobs Park, meeting monthly for eight years, and was empowered to make a number of decisions for a redevelopment area, and focused on the difficulties confronting both the community and businesses regarding job creation expectations, long-range planning, marketing, and design guidelines. The area's city council member agreed to support whatever decision the committee made and work to pass those through the full city council.

To spur job growth and provide employment opportunities for neighborhood residents, the MCDA and the steering committee worked with the city's employment and training program and local job training providers, including the Urban League, the Electrical Workers Union, and Dunwoody College. These efforts connected residents with jobs in both the construction of the Jobs Park and staffing for companies investing in the Jobs Park.

In the first seven years, Ambassador Press, A&M Business Interiors, ASI Signs, DHL Worldwide, Rochford Supply Company and X/O Communications move into the Jobs Park. These companies invested more that $38 million and created over 420 jobs, increasing property values by an estimated $7.4 million.

— Submitted by Erik Hansen

 

West Broadway Alive!


In 2005 the City of Minneapolis, through its Department of Community Planning and Economic Development (CPED), reengaged the city's north side in a refocused redevelopment effort on its main street, West Broadway. This effort began with the alignment of staff resources in the economic development and planning divisions of the department and a commitment to reinvesting in the commercial corridor together with the community.

Over the next five years, intense work from CPED, community-based organizations, developers, partnering government, not-for-profits, businesses, and residents set West Broadway on a new course as a corridor connected through the arts and anchored by institutions nurturing the human capital of the community.

Activity in the corridor began with the redevelopment of a 100-year-old building at the heart of the business district. The building at 1101 West Broadway, once home to dentist, doctors, and grocery stores, fell into condemnation, sitting vacant and boarded for more than eight years. Across the street from the empty building was a small arts studio, Juxtaposition Arts (JXTA). JXTA was a small yet powerful change agent working with the community and CPED to provide arts programing to the community. JXTA was critical to aligning a number of other arts organizations, including Northside Arts Collective, the Capri Theater, and Homewood Studios, with the City to establish arts as a main theme to the West Broadway Alive! small area plan that would guide the subsequent redevelopment work.

The West Broadway Coalition, the neighborhoods along the avenue, and U.S. Bank partnered with the city to produce the plan, which set out guidelines for a new era of investments in preserving and enhancing the corridor. On the second floor of 1101 West Broadway, a new spin off organization from Pillsbury United Communities, Emerge Community Development, would begin to offer workforce development training to community members. Emerge was one of a number of human capital development organizations that would call West Broadway home after the adoption of West Broadway Alive! Others included Northside Economic Opportunity Network, Plymouth Christian Youth Center, Urban Homeworks, Upper Midwest American Indian Center, Catalyst Community Partners, Kindred Kitchen, Minneapolis Public Schools headquarters, DEED's Workforce Center, Neighborhoods Organizing for Change, Northside Achievement Zone, and the YMCA.

Private developers took on challenging projects to reposition several buildings into community serving amenities and added housing and retail shops to support the anchor institutional uses. Developers such as the Ackerberg Group, Sherman Associates, Wellington Management, Master Development, Rose/Lupe Development, and Alliance Housing invested in the area.

As a result of these efforts, West Broadway is now home to an annual arts crawl and open streets festival, numerous installations of public art, growing small businesses, and several organizations investing in the community.

— Submitted by Erik Hansen

 

City of Burnsville & DEED Partner to Retain/Expand Major Corporation

Goodrich Sensors and Integrated Systems (now UTC Aerospace) reached out to the City of Burnsville in early March of 2010 regarding the possibility of a future expansion and retention of all existing operations. Goodrich management explained that numerous locations around the country would be seeking expansion funds; not all of which would be funded. Funding would be based on the locations ability to present a compelling case for best expansion value. The Burnsville location had excellent productivity figures and was capable of making the case that the local workforce was available to fuel the expansion. A number of other locations were promising with very generous incentives by local and state authorities. Goodrich-Burnsville management did not feel those incentives needed to be matched, but that some incentives would be needed to couple with the other compelling reasons to expand in Burnsville.

The City of Burnsville enlisted the help of the Department of Employment & Economic Development (DEED). Multiple meetings were held with all parties. DEED proposed a tax rebate proposal that Goodrich felt would be positive. The rebate needed legislative passage. DEED, Goodrich leadership, and Burnsville officials walked the capitol halls the last week of session to secure support for the proposed bill. The bill passed on the last day of session and provided $4,000,000 of tax rebates once Goodrich spent $59,000,000 in capital expenditures. The City of Burnsville owned land that abutted the Goodrich property. As the expansion would take most of the current Goodrich land, creating a need for green space. Burnsville offered the option to Goodrich to purchase the land for $1.00. Burnsville further offered to waive $30,055 in current assessments on its land and to waive $727,000 in park dedication fees.

The retention and expansion efforts will result in the following:

  1. An estimated 150 jobs created over the next three years.
  2. The retention of the current operations will result if the retention of up to 1,100 jobs.
  3. The average wage of the new jobs is estimated at $70,000 per job.
  4. The property tax increased approximately $300,000 per year.
  5. The private investment is estimated at approximately $80,000,000 over three years.
  6. The public investment is estimated at approximately $5,067,755 and consists of
    • $4,000,000 in tax rebate.
    • City land at $310,700 of assed value.
    • $30,055 of waived city assessments.
    • $727,000 of waived park dedication fees.
  7. A one of a kind wind tunnel was constructed and is used for testing by UTC Aerospace and numerous other entities around the world.

The project was an EDAM Excellence in Development winner in 2011.

— Submitted by Skip Nienhaus


New Flyer of America

New Flyer Industries of Canada manufactures buses for public transit systems. New Flyer has the largest market share for transit buses in North America. In September of 1999 New Flyer opened its new 338,000 sf facility in St. Cloud. At the start of production, New Flyer created 450 new jobs. The company has added to the facility now totaling 350,000 sf and the total employment is now 705 employees. New Flyer buses have been purchased by the City of St. Cloud, MTC and many other cities throughout Minnesota and North America. According to Paul Soubry, President of New Flyer Industries; "the St. Cloud facility is the most modern manufacturing plant of its type in North America". Instrumental in making the New Flyer project a success included: - City of St. Cloud - St. Cloud HRA - St. Cloud Opportunities, Inc. - MN Department of Employment & Economic Development - Congressman Collin Peterson - Congressman James Oberstar Architect - Pope Architects General Contractor - Kraus-Anderson Owner's Representative & Project Manager for New Flyer - Bruce Maus, Auxilium Solutions, LLC Scope of responsibility included: - Site Selection - Facility Planning - Design & Construction - Incentives - Permits & Approvals

— Submitted by Bruce Maus


How Minnesota Got the Best Data Center Incentive Package in the U.S.

stream data center

Sometimes economic development tools are created out of a desperate need to respond to an emerging issue or sector, in a way that was virtually unknown to the economic development community before. This is the story of how Minnesota's data center sales tax exemptions — now considered one of the best data center incentive programs in the country — came into being. It is also a story of how a body of development expertise can evolve to be an active part of the tools used to keep Minnesota competitive.

The story begins less than ten years ago. In early 2008, DEED’s Business Development office received a “request for proposal” from a consultant for “Project Cowbell.” The anonymous project, described as a “data center,” referred to tremendously large site and electrical power requirements, and sought information on the incentives the state might offer. Responding to the inquiry were Mark Lofthus, business and community development director, and Gene Goddard, senior business development representative. At the time, DEED had no technical experience with data centers, and certainly no special incentives to offer this apparently unique and emerging industry. A $500,000 forgivable loan from the Minnesota Investment Fund and offer of job training help were the only financial tools available at the time. Clearly, they were going to be inadequate to win this project. Maybe more pointedly, few understood that “the Cloud” was emerging as the way in which massive data storage occurred, in the physical embodiment of these very large technology hubs.

DEED prepared a response to the proposal, and offered several sites. However, the admittedly sparse knowledge of the industry and few meaningful incentives suggested it would not be won. As it turned out, “Project Cowbell” was Yahoo, which built a large data center in LaVista, Nebraska, outside Omaha. The construction of the several hundred million dollar facility hugely impacted the state of Nebraska as a location for future data center development. One of Nebraska’s advantages was a robust telecommunications network built by the Defense Department due to the Strategic Air Command’s major operations within the state. However, they had also been one of the first states develop a data center strategy and pass an incentive program which helped them win the project.

Time moved along, the recession hit the country hard, and DEED began to strategize about how to support the long-term growth of our headquarters companies, get the large number of unemployed technology and construction workers back on the job, and help stabilize our energy and telecommunications infrastructure. In the summer of 2010, DEED was approached by a large financial institution (in the spirit of the non-disclosure agreement that was signed at the time, it will remain anonymous) seeking to build a data center somewhere in the U.S, and for a number of reasons Minnesota had made the short list. The project was described as potentially 1 million square feet of new construction, costing in excess of $1 billion in capital investment and requiring 700,000 labor hours to build the facility. However, in the absence of any meaningful incentives to help offset higher costs in Minnesota, the project was not going to locate here. Winning that project, and others like it, clearly required a different approach — or, to use the famous phrase, “a bigger boat.”

Goddard and Lofthus proceeded to draft legislation, partnered with Jones Lang LaSalle and the MN High Tech Association to refine the bill, and worked with bill authors Representatives Mazorol, Gunther and Kahn along with Senators Michel and Bakk to gain the support of Tax Committee Chairs, Sen. Ortman and Rep. Davids, to get the bill introduced into the 2011 legislative session. Hearings were held in the 2011 session, with testimony from several data center industry executives, to help educate officials on the nature of the industry, its benefits for the state, and what other states were doing to attract this emerging sector. The proposed legislation would treat data centers like manufacturers (who also require large amounts of capital and energy) and provide sales tax exemptions for equipment and electricity, for 20 years, for qualifying facilities meeting certain minimum facility size and investment requirements.

Due to the course of the 2011 legislative session, which ultimately led to the state shutdown in July of that year, nothing passed during the regular session. However, toward the end of the 21-day shutdown, with the State Capitol building closed to all but a few, an opportunity appeared to bring the legislation into the omnibus tax bill which was being negotiated between Gov. Dayton’s office and the Republican-controlled House and Senate.

Goddard, by that time with the new staff of GREATER MSP, communicated with Lofthus, who was given Capitol access to meet with the bill negotiators. GREATER MSP’s encouragement to the Governor’s office was essential to get the bill’s language included in the tax bill. With discussions wrapping up late-late Saturday night before the end of the shutdown, final terms were agreed upon, and the language to award sales tax exemptions for data centers with at least 30,000 square feet and $50 million investment was enacted in the tax bill that helped end the state shutdown.

The law remains on the books effective through 2045. Regrettably, the near-economic collapse had caused the original mega-data center project to be cancelled. However, the legislation became a crucial tool for ongoing attraction of new investment. Because of the new market realities after the Great Recession, the legislation was amended in 2013 revising the qualification thresholds to 25,000 square feet facility and $30 million in capital investment, and became critical to supporting the number of data center projects going forward in Minnesota.

To date, the state has recorded 20 different data center projects that have applied for the sales tax exemption, totaling nearly $1.7 billion in capital investment that wouldn’t have otherwise occurred in Minnesota without the incentive. In the opinion of most data center industry experts, Minnesota now has one of the best data center legislation incentive programs in the country. Because of this legislation, and the diligent efforts by many to get it passed, “The Cloud” has a strong future in Minnesota.

— Submitted by Mark Lofthus


Rice Creek Commons: From Brownfield to Redevelopment

Rice Creek Commons

Ramsey County purchased 427 acres of the former Twin Cities Army Ammunition Plant in 2013 with the goal of reviving the dormant property in Arden Hills into the economic and social engine it once was. During World War II, the plant employed more than 26,000 people — half of whom were women.

The site has been inactive since 1976. The cost of cleaning up the site has precluded it from previous redevelopment efforts. After purchasing the site in 2013, Ramsey County led efforts to remediate the soil to residential standards. The county invested $30 million in the land purchase and cleanup. Work was completed in November 2015, and the Minnesota Pollution Control Agency issued a Certificate of Completion for the remediation in July 2016. Work to redevelop the site is overseen by a Joint Development Authority (JDA), which was created through a Joint Powers Agreement between Ramsey County and Arden Hills.

The JDA is the first joint powers board created to redevelop a Superfund site. The board is made up of two county commissioners, two city council members, and a non-elected city appointee. The JDA contributed to the development of the Rice Creek Commons master plan, which provides a vision for the site that weaves together the specific objectives of both Ramsey County and the City of Arden Hills, ultimately creating a vision for a development that will increase the tax base, create jobs, and diversify housing opportunities.

Rice Creek Commons is the last large-scale redevelopment opportunity in the seven-county Minneapolis/Saint Paul metropolitan area. When all is said and done, the 427-acre site, cleaned up and revitalized from its prior industrial use, will serve as home and workplace to hundreds of families and professionals, and will be a catalyst for economic development across the region. Three different types of neighborhoods will attract people in all stages of life and of all income levels. Office and retail development will drive the region's economy, and more than 50 acres of green space with connections to parks and trails will round out the area as a great place to live, work and play.

Anticipating thousands of residents and employees at Rice Creek Commons, Ramsey County is working to improve several access points to the site. They include a new interchange at I-35W and Highway 96 (completed in 2015); a new interchange at I-35W and County Road H (currently under construction); a roundabout at the intersection of County Road I, Rice Creek Parkway, and Old Highway 8 (to be constructed in 2017); and a new major county road that will provide primary access to residential neighborhoods and commercial areas throughout the site (to be constructed in 2017). In total $50 million has been invested since 2013 in infrastructure improvements near the site.

At full buildout, Rice Creek Commons will be home to 3,000 new residents; support 4,000 high- or living-wage jobs; generate $10 million annually in new taxes; and attract $1 billion in investments from the private sector.

— Submitted by Heather Worthington


How Redwood Falls attracted Daktronics, a South Dakota firm, to Replace Lost Jobs

In the February of 2006, Redwood Falls officials learned that Artesyn Technologies, a manufacturer of power supplies, had been acquired by Emerson Electric. In July of 2006, Emerson Electric announced they would be closing their doors in Redwood Falls at the end of December. The move would put 240 employees out of work, many of them head-of-household positions.

Local elected officials and the development team, headed by Julie Rath, Economic Development Specialist with the Redwood Area Development Corporation (RADC), brainstormed on possible solutions. Ten potential electronics companies were identified and approached to come and visit Redwood Falls. A few days after the email had been sent out through a referral, Daktronics, a Brookings, S.D. electronic sign manufacturer, called Julie and said, yes, they would consider coming to visit our facility and see what we had. Two other companies were also interviewed for potential interest in expanding to Redwood Falls. Daktronics determined Redwood Falls could be a potential community to expand or grow their company.

A visit with Daktronics officials was arranged, and RADC, community team members, Lisa Hughes with DEED, and representatives from higher education facilities in southwest Minnesota traveled to Brookings for a plant tour and discussion. In followup conversations, DEED and Redwood Falls offered JOBZ tax benefits, to which a Daktronics official pointedly said, "If you didn't have that on the table, we wouldn't be here talking."

The outcome was that by the end of December, Daktronics announced they would acquire Artesyn's Redwood Falls facility, and keep 110 jobs. Another spinoff company, RVI Inc., also started up to take over the former Artesyn power supply repair division. RVI, owned by Ritalka Inc. from Montevideo, retained approximately 25 jobs. The buildings were locked on December 31, and reopened on January 1, 2007 with two new companies in town.

Today, Daktronics continues to thrive in Redwood Falls, with current employment of 180. Evidence of their success is that Daktronics is the manufacturer of the scoreboards that have been installed in the new US Bank stadium and many other sports facilities across the country, as well as other private business installations. The expansion of Daktronics into Minnesota illustrates several points:

  • What well-trained, strong local staff and political leadership can accomplish
  • Willingness to be creative in overcoming economic obstacles (including the unusual, almost inconceivable solution of asking a South Dakota company to expand into Minnesota)
  • Value of a skilled and highly productive workforce
  • Strength that comes from partnership between local and state government
  • Desire to use any state and local tools available to retain and win jobs in a community

— Submitted by Mark Lofthus


Marketing Initiative: Burnsville Commercial Real Estate Council

The Burnsville Commercial Real Estate Council (BCREC) is a partnership between the City of Burnsville, the Burnsville Convention & Visitor Bureau (CVB), the Burnsville Chamber of Commerce, and commercial property owners in Burnsville. The BCREC working committee is comprised of representatives of multiple Burnsville building owners, the city Economic Development Coordinator, the Burnsville CVB president and the Chamber president.

The group was formed over 20 years ago to assist the city in marketing efforts. Their activities have included broker tours of sites with vacancies, networking events, and thank you celebrations for brokers who brought investment to Burnsville.

In 2009, an ongoing outreach was created with quarterly e-newsletters and e-holiday greetings. Over 300 metro commercial brokers receive these, with almost one outreach per month. Because of the BCREC efforts, Burnsville is home to over 2500 businesses and averages approximately 40 new businesses per year. In 2010 the BCREC efforts were recognized by EDAM with a Marketing Award at the annual awards ceremony.

— Submitted by Skip Nienhaus

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